✈ September 6, 2017, Avicor Aviation Inc.
Given the current weather events affecting much of our nation, we thought that perhaps a discussion about how the value of being prepared for an emergency can help to maintain the value of your aviation business was timely.
The reality is that most business owners are not truly prepared for emergencies. Whether it's a weather event, a fire, the sudden loss of key personnel or equipment, or something completely different, a major emergency can end a business or decimate its value if it's not prepared.
Here are five key items that should be on your Prepared for Anything list:
Most businesses these days have most of their financial record keeping on computer. And at one time or another, their computer system has failed and some restoration has been in order, so there is a general awareness of the importance of more than one backup for financial records.
But sometimes those backed up records don't get stored in more than one place.
Today we have the option of storing records online, on "the cloud." There is an enormous advantage to having your financial records "on the cloud." Key is the fact that even if your business goes down, the data is retained and you can pick up where you stopped without losing information. Anyone who has lost a computer file can tell you how valuable that is.
If your business is in a location prone to weather events, keeping records in virtual space is one great way to make sure that you don't lose them and the time and energy it takes to rebuild that information.
Like the financial data that you need to operate your business (and you are required to keep by the IRS), there are typically many other documents that are vital to the operation of your company. Many of those records are probably already on digitized files. But it's important to regularly take a look at what your business depends on in the way of documents and what either the IRS, FAA, or other regulatory body requires.
Again, many of those documents can now be stored online, "on the cloud," freeing you up from worrying about losing the physical documents.
But there are some documents that you will still need physical copies of. Make sure that you have several copies of key documents and don't store them all in your office. There should be other places that information can be stored safely, under lock and key as necessary, especially documents that cannot be stored digitally.
Most every business today carries insurance. Often contracts undertaken require it. And if you have aircraft in the business, run an FBO or a maintenance facility, it is likely that you do have insurance to cover unforeseen events that could damage those hard assets.
Your insurance, however, should also provide for some funds to allow you to get your business back up to speed in the event of a major emergency, not just provide for the hard assets.
Every business owner or key management team should review the company's insurance coverage annually. Not just renew it, but consider how the business has actually grown and/or changed, and what would happen if an emergency meant it could not operate for a time. The coverage can mean a future for both you and your employees.
Having backups and insurance coverage is important, but also take a look at who is responsible for what when an emergency happens.
It can be helpful to take a walk through your business and think through the various aspects of your operation. Generally, there is someone responsible for each aspect of the business. Do they know what to do if there is an emergency? Do they know what is most important to take care of? Could your management team operate remotely if necessary?
Its' all fine and dandy to make plans and document them all in a notebook and then put it up on the shelf and forget it. That does no one good.
It's more important to sit down with your management team and make real plans. Talk about what is important to the business. Decide who is responsible to do what in an emergency. Set steps in motion for backups. Review and reassess insurance.
But make it an annual event. Put it on a regular schedule and then actually do it! If your business is located where there are hurricanes each year, plan it in the spring so you are ready as you head into the season. If you are located out west where forest fires can get out of control, have that planning meeting in the winter well ahead of fire season. If you receive a lot of snow in winter and that can cause issues, plan ahead in late summer or early fall.
In any case, Be Prepared if you want to maintain the value in your aviation business!
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